RESTRICTED
GUANGDONG NUCLEAR POWER PROJECT : ESSENTIAL FACTS
1.
Guangdong Province is energy deficient. Lord Kadoorie
sees opportunity here to bind Hong Kong and Guangdong more
closely together. Basis of project is proposed joint venture
between China Light and Power Ltd (CLP), the utility supplying
Kowloon and the New Territories, and Guangdong Power Company.
A feasibility study is under review in Peking but timescale
seems to have slipped 1-2 years. The cost is worrying Chinese
planners and alternatives (eg hydro-electric schemes) are also
being considered. If the decision is to go for the project
the UK cannot supply a Pressurised Water Reactor (which the
Chinese favour) and needs to cooperate with Framatome (France)
or Westinghouse (US). GEC hopes to provide the turbines and
BNFL is interested in fuel supply. Main danger is an all-French
bid and there is an apparent Chinese commitment to a French
reactor reconfirmed to Mr Rees by Vice Premier Gu Mu (Peking
Telegram No INDUS 20 attached). But central role of Hong Kong
to viability of project, and CLP's preference for UK equipment
give the UK a good bargaining position. Again Gu Mu seems to
have recognised this. But financial terms will be crucial.
Hong Kong and General Department
December 1981
RESTRICTED